\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 160 Zhejiang Juhua Co.Ltd(600160) )
Core view
The performance at the bottom of the cycle still increased significantly against the trend, and the performance continued to improve quarter by quarter, year-on-year and month on month. The company issued the annual report for 2021: in the face of the adverse factors of fierce competition in the fluorine chemical market of its core business, the company still actively responded to market changes, increased production and sales, increased income and profits, and steadily promoted high-quality development: in 2021, the company achieved an operating revenue of 17.986 billion yuan (year-on-year + 12.03%); The net profit attributable to the parent company was 1.109 billion yuan (year-on-year + 106287%). From 2021q1 to Q4, the company's performance continued to improve quarter on quarter and month on month, and the growth rate of the company's profit was much higher than that of its revenue. Among them, in 2021q4, the company achieved an operating revenue of 5.363 billion yuan (year-on-year + 4.28%), and a net profit attributable to the parent company of 851 million yuan (year-on-year + 139547%), which exceeded our previous expectations. Overall, in 2021, the company continued to improve its industrial layout against the trend, seized market opportunities, and actively adjusted its product structure to seize market share. We are optimistic that the company is expected to grasp the opportunities brought by the change of industry pattern in the future.
Excellent cost control ability, benefiting from rising product prices and continuous volume of main business. In 2021, the average prices of fluorine chemical raw materials, refrigerants, fluoropolymers and fluorine-containing fine chemicals of the company increased by 80.91%, 41.58%, 39.01% and 6.27% respectively year-on-year; The output of the third generation fluororefrigerants (HFCS) and fluoropolymers followed the growth momentum based on the substantial growth of the previous year, with a year-on-year increase of 2.61% and 31.52% respectively. In the single quarter of 2021q4, the company's refrigerant business volume and price rose simultaneously, and the price of polymer products rose sharply; At the same time, in terms of cost, the company carefully organized production and operation, explored potential and increased efficiency, saved energy and reduced consumption, and purchased opportunities, so as to better control the adverse impact of the sharp rise in operating costs caused by the rapid rise in the price of raw materials, and the impact on the cost side of raw materials is small. As the competition pattern of the industry tends to be concentrated, we are optimistic that the third generation refrigerant is expected to usher in a boom recovery. The company has the advantages of perfect industrial chain integration, and still maintains efficient operation against the trend, which will lead the cycle recovery in the future.
Develop high value-added fluorochemicals, extend the industrial chain, and actively promote the industrialization of coolant products for data centers. In addition to actively promoting the construction of lithium battery materials such as PVDF project, Zhejiang Juhua Co.Ltd(600160) has also successfully developed a giant core coolant for high-performance big data center equipment, filling the gap of special coolant for high-performance big data center in China. The company's submerged coolant project has a planned capacity of 5000 tons / year, of which the first phase of 1000 tons / year project is in the construction stage. We are optimistic that in the future, the company will continue to further expand the output of high value-added fluorine chemical products such as fluoropolymers, fluorine fine chemicals and fluorine coolants through capacity tapping, energy conservation and emission reduction, cost reduction and structural optimization, so as to achieve high-quality development.
Risk tip: weak demand for fluorine chemical industry; The production progress of the project is less than expected; Sharp decline in product prices, etc.
Investment advice: maintain the "buy" rating. In recent years, the company has seized the market opportunity, actively promoted the optimization of fluorine chemical product structure, continuously enhanced its core competitiveness and strengthened its position as a fluorine chemical giant. We expect the net profit attributable to the parent company from 2022 to 2024 to be RMB 1.622/24.80/2.916 billion respectively, with a year-on-year growth rate of 46.2% / 52.9% / 17.6%; Diluted EPS = 0.60/0.92/1.08 yuan, corresponding to the current share price, corresponding to PE = 19.2/12.6/10.7x. Maintain "buy" rating
